Borislav Tonev

Ubiquity Inc (OTCMKTS:UBIQ) Rears its Head Again

by Borislav Tonev February 26, 2016

Ubiquity Inc (OTCMKTS:UBIQ, UBIQ message board)'s company profile at the OTC Markets is stamped with a Buyer Beware sign and earlier today, the marketplace even decided to stop showing the quotes for the stock on its website. As you probably know, the Skull and Crossbones badge is given in order to urge investors to exercise extra caution when dealing with the companies who wear it. So, does it work?

Not really. More than 2.1 million shares changed hands during yesterday's session which pushed the dollar volume up to more than $600 thousand. The stock surged in the right direction and after six and a half hours of intense trading it stopped at $0.27 per share – the highest close in over three and a half months.

Part of the humongous volume was generated by a paid pump carried out by Epic Stock Picks and its affiliated websites who, in exchange for $57,500, did quite a lot of touting throughout the day. Predictably enough, the pumpers said nothing about the fact that UBIQ has yet to file its report for the third quarter of last year and they also didn't mention the latest 10-Q.

We reckon, however, that you deserve to know what it looks like which is why, we're now presenting you with a summary of the most important figures:

  • cash: $189 thousand
  • current assets: $520 thousand
  • current liabilities: $9.2 million
  • quarterly revenues: $21 thousand
  • quarterly net loss: $7 million

Of course, UBIQ's management team wouldn't like you to think that the results will remain the same for long. Yesterday, they (willingly or not) gave the pump a helping hand by announcing that the company's Sprocket software has been launched by iWebgate – UBIQ's licensee. The PR would lead you to believe that Sprocket could gain as much as 800 thousand users which should have an immense impact on UBIQ's financial statement. But will it keep the stock up for long?

That depends on whether discounted shares are about to hit the open market. And we wouldn't dismiss this possibility too quickly.

The latest 10-Q says that during the first half of last year, the company picked up about $2.4 million worth of debt convertible at discounts ranging from 35% to 45%. At the same time, UBIQ sold just over 13 million shares at an average price of $0.05 per share. The capital raising activities continued after the end of Q2 of 2015 when third party investors purchased a further 55.1 million shares for a little over $1.8 million or about $0.03 per share.

How this is going to affect the stock is for time to tell.

About fifteen minutes into today's session, the ticker is sitting at $0.265 (2% in the red).

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